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Is a Free Trial Always Better Than a Demo?

By Emily Smith on Wed, Feb 10, 2016

Which offer will be most likely to motivate your potential customers to engage with you: a free trial or a demo?

It’s generally accepted that for your software as a service product a free trial is always preferable to a demonstration. It provides the prospect with the freedom to use the tool in their own time, at their own pace, and experience real value first-hand before making their purchase decision.

However, in some cases a demo will be preferable. It depends on your product, and how your potential customers perceive the value it offers.

The Free Trial Problem

Many SaaS products require a significant commitment of time and effort from your prospect to ensure it is set-up properly, and then to understand how and why to use the tool.

For example, if you created a tool for building landing pages, your free trial needs to let a user create a landing page that they can clearly see out-performs their existing landing pages significantly. If your users can’t easily create a landing page using your tool, or they can’t see a significant difference in the page’s performance compared with their current pages, your free trial is a problem.

A valuable free trial is an important long-term goal, but can be a particular problem for early-stage startups.

Tutorial resources take time and energy to create, and with your product in a state of flux, are liable to be quickly outdated. Improving your free trial or making it easier to use can be a distraction taking up your software engineers’ time – time that could be spent improving the product your customers pay for. 

When staff time and resource are limited – such as in an early-stage startup with a small team  you may find that you are better served by an effective demo, rather than a free trial.

When a Demo Works Better

While a free trial is great for letting prospects discover the value of your service themselves, a demo will show and tell. Demos are particularly useful when:

  • Your product requires extensive set-up to gain value
  • Your product requires a change in key business processes to generate value
  • Your free trial requires lots of additional learning in order for your prospect to understand the real value it provides

A demo can be presented in many forms – a video, a sales presentation, a walkthrough, etc. – but whatever form it takes, it usually comes with an environment that allows the viewer to listen, ask questions and understand the value of the offer.

In the instances outlined above, a demo is preferred to a trial because it gives you a chance to speak to the prospect, show them the tool (bonus points if it’s pre-populated with data that’s relevant to their business), and help them reach the “aha!” moment that results in them thinking they need your tool.

They get to see the value, rather than struggling to find it themselves in a free trial.

Additionally, a demo provides you with feedback – extremely valuable for early-stage startups who are trying to find Product/Market fit.

During a demo prospects can ask you questions: does the product do X? How do we do Y? Is there function Z? These questions, from every demo you run, all combine to help you understand what your prospects want from your tool, so you can get a feel for how well your product is solving their actual problems, rather than your perception of their problems.

Is a Free Trial or a Demo Best for my SaaS Product?

Short answer: it depends. But here are three things you can ask yourself to help you assess which will provide more value to your prospects:

  1. Is my product easy to set-up? (Takes only a few minutes, easy to integrate with existing tools, doesn’t require significant data entry before first use)
  2. Is my product easy to use? (Has an objectively simple user interface, that clearly guides the user towards making proper use of the tool to generate value for them)
  3. Does my product provide a clear “quick win” for users – straight out of the box? (Can a user quickly reach the “aha!” moment in their first session without logging a support ticket, reading your FAQs, etc.)

What works best for you now may not always be your best option, so be sure to reassess the efficacy of your trial or demo regularly to ensure it is converting prospects into users.

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